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Dallas Airmotive Inc., a provider of aircraft engine maintenance, repair and overhaul services based in Grapevine, Texas, has admitted to violations of the Foreign Corrupt Practices Act (FCPA) and agreed to pay a $14 million criminal penalty to resolve charges that it bribed Latin American government officials in order to secure lucrative government contracts.
According to Dallas Airmotive’s detailed admissions in the statement of facts accompanying the deferred prosecution agreement, between 2008 and 2012, the company bribed officials of the Brazilian Air Force, the Peruvian Air Force, the Office of the Governor of the Brazilian State of Roraima, and the Office of the Governor of the San Juan Province in Argentina. Dallas Airmotive used various methods to convey the bribe payments, including by entering into agreements with front companies affiliated with foreign officials, making payments to third-party representatives with the understanding that funds would be directed to foreign officials, and directly providing things of value, such as paid vacations, to foreign officials.
“We regret that those standards were breached by a limited number of third-party agents and employees of Dallas Airmotive's business in South America from 2008-2012. These individuals are no longer with the company” and the company's Brazil and South American sales team are operating under new leadership.
The OECD study - based on analysis of data emerging from all foreign bribery enforcement actions concluded since the introduction of its own Anti-Bribery Convention in 1999 - also found that most bribes are paid in advanced countries instead of emerging markets.
The OECD report cast doubts over the frequent corporate defense to graft claims that senior executives were unaware of the bungs.
Most international bribes are paid by large companies, usually with the knowledge of senior management.
The report defined a large company as one with more than 250 employees. It added:
In 41% of cases management-level employees paid or authorized the bribe, whereas the company CEO was involved in 12% of cases.
The OECD found that the majority of bribes it studied were paid by companies to governments or state-owned enterprises, in order to secure contracts.
Bribes are generally paid to win contracts from state-owned or controlled companies in advanced economies, rather than in the developing world, and most bribe payers and takers are from wealthy countries.
The majority of cases it found occurred in four industries: resources extraction, construction, transport and IT.